Just hours after the House of Representatives passed the Tax Cuts and Jobs Act, the Senate Finance Committee approved its version of the bill. These are huge steps towards achieving fundamental tax reform. And while most of the attention has been focused on the benefits of reducing income taxes, other tax provisions are also worthy of praise.
In particular, National Taxpayers Union (NTU) commends Chairman Hatch and the entire Senate Finance Committee for including a modified version of S. 236, the “Craft Beverage Modernization and Tax Reform Act” in their tax reform legislation. Adding this amendment is a meaningful development for all producers of alcoholic beverages, especially small brewers, distillers, and winemakers.
With 29 Democratic and 25 Republican co-sponsors in the Senate, S. 236 is a strongly bipartisan bill. Senators have crossed party lines because they recognize that lowering taxes on this industry will be a boon for producers, workers, and consumers.
Specifically, S. 236 reduces the Federal Excise Tax (FET) from $7 to $3.50 for small brewers, from $13.50 to $2.70 for craft distillers, and expands excise tax credits for winemakers. With an estimated $130 million in annual savings, this infusion of capital will allow the industry to expand their 4.6 million workforce, boost production, meet growing consumer demand, and allow for innovation, providing consumers with greater choice.
With the permanent income tax reduction in this bill, businesses will know what to expect and invest in growth that will be sustained over the long term. As the tax reform process moves forward in the Senate and into conference committee, NTU strongly encourages lawmakers to keep these important changes to alcohol excise taxes in their final product.